An employee benefit plan that allows employees to choose from a variety of benefits to formulate a plan that best suits their needs.

Also known as 'cafeteria employee benefit plan' or 'flexible benefit plan'. Similar to a cafeteria where individuals can select their food of choice, employees may choose benefits of their choice. Plan options include health and accident insurance, Cash benefits, Tax advantages and/or retirement plan contributions.

Though some cafeteria plans Offer an explicit choice of Cash or benefits, most today are operated through a "salary reduction agreement", which is a payroll Deduction in all but name.